Abstract

The Natural Resources Institute has been conducting preliminary research on experiences with private sector provision of credit to small-holders for production inputs. The initial research focused on the cotton sectors in Uganda and Zimbabwe, where input credit different systems are in operation. The intention is to distil key conditions from these experiences with a view to identifying potential applications in other sectors.

The research has highlighted the extremely low input/low output nature of most farming systems in Uganda, and very low use of even the most fundamental components of improved technology ie., improved varieties (either open-pollinated or hybrid seed) and fertiliser. There are a number of factors influencing this which can be categorised under four broad headings: affordability, physical access, awareness and commercial context. Access to credit influences affordability and can certainly play a role, but it is clear that other factors are equally important. Box 1 lists some of the issues which impinge on the use of purchased inputs.